Global Trends in Commodities and Threats to Watch in 2024

"After three years of extreme volatility, commodities prices are set to broadly stabilize in 2024," according a report published by the Economist Intelligence Unit (the EIU). Moreover, "This apparent stasis may come as a surprise given the many geopolitical headwinds buffeting the global economy at the moment. These range from adverse weather conditions to escalating conflict in the Middle East and rocketing freight rates owing to disrupted shipping routes through the Suez and Panama canals. However, this holding pattern for commodities prices in 2024 belies what will be an eventful year as markets remain volatile in the short term before secular trends, especially those linked to the green transition, come to the fore."

The EIU says El Niño and the Russia-Ukraine war still loom large for soft commodities. With respect to the former, "Prices for food, feedstuffs and beverages (FFB) will rise over the course of 2024, driven primarily by beverages, as El Niño will hit production and therefore prices for coffee and cocoa will increase." The report encouragingly says "Some relief is in sight, with the US National Oceanic and Atmospheric Administration (NOAA) giving a 72% chance that El Niño will come to an end by mid-year. But the damage to this season's harvests will already be done by then, with coffee and cocoa production forecast to fall by 9% and 13% respectively in the 2023/24 crop season."

As for Russia's unjustified invasion of Ukraine, the report points out that "Russia's permanent withdrawal from the Black Sea Grain Initiative poses another upside risk to global food prices, particularly wheat, maize and oilseeds. However, the impact on prices so far has been muted, as Ukraine has managed to export grains and oilseeds via alternative road and rail routes across the country's western borders." The EIU explains how "Ukraine's grain exports initially plummeted following the collapse of the grain deal last summer, but they have recently picked up after Ukraine successfully established a temporary shipping corridor through the western Black Sea with the help of Romania and Bulgaria."

The report importantly says "exports will still not match pre-war levels, which will keep a floor under wheat and maize prices in the short run. At the same time, rice prices will rise in 2024, underpinned by white rice export restrictions in India — by far the largest supplier to the global market."

The EIU is also forecasting oilseeds prices stabilizing in 2024 and as with international soybean stockpiles remaining relatively tight, "prices will remain susceptible to perceived threats to world supplies, either from climate events or further supply-chain disruption." However, the EIU expects "a strong rise in soybean production (owing to a bumper crop in Argentina, which actually benefits from El Niño), which will drive soybean prices downwards over the course of the year. Despite a probable market deficit in the 2023/24 season (October-September), palm oil prices will remain low due to falling prices for rapeseed and sunflowerseed oils, which are also benefiting from Ukraine's temporary export route."

The green transition will be a driver of base metals prices by end-2024, according to the report. The EIU's forecast for their "base metals price index will increase by an average of 3% in 2024, after falling by more than 11% in 2023, as the green transition supports rising demand for critical minerals. Even for metals such as nickel that will register significant year-on-year declines in 2024, prices are poised to rise from their end-2023 levels. Despite a strong supply response from producers, which will lead to a market in oversupply in 2024, low reserves will make nickel susceptible to supply-chain disruption." Furthermore, "London Metal Exchange (LME) warehouse stockpiles remain low by historical standards and the availability of class 1 nickel will be limited by end-users deciding to avoid using Russian supply."

The EIU is predicting energy prices, excluding crude oil, will trend downwards in 2024. In the comping year, "prices of hydrocarbons will largely trend in the opposite direction than those of most industrial raw materials and soft commodities. We expect average European natural gas prices to fall by one-fifth in 2024, after plummeting by more than two-thirds in 2023, largely due to demand destruction, particularly in industry. However, there will be periodic spikes owing to market anxiety about the security of global supply chains, amid rising geopolitical tensions stoked by the Israel-Hamas war. Nevertheless, prices will remain historically high, limiting any significant recovery in industrial demand."

In addition, "Strong European demand for liquefied natural gas (LNG) will push up US prices from their current low base and limit the fall in LNG prices. Coal prices will continue to trend downwards as long as gas storage levels in Europe remain seasonally high and LNG continues flowing to the continent, limiting the squeeze on gas supplies in Europe."

As for crude oil prices, "The US has ramped up production and exports, and the global market has moved back into surplus (production exceeding demand). However, as Saudi Arabia is unlikely to increase output markedly this year, and with other OPEC members also implementing voluntary cuts, the market will periodically return to deficit, which will limit the downside to oil price forecasts. Global oil demand will also put a floor under prices and is set to reach record highs in 2024 and in subsequent years as consumption in the developing world continues to increase." What is more, "Heightened geopolitical risks tied to the Israel-Hamas war still threaten to cause prices to soar again. Although we expect crude oil prices to remain volatile, they should mostly trade at about US$80/barrel, essentially where they began the year."

What trends in commodities and threats are you watching in the next 12 months?

​Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

How Corporate Boards Can Confront Crisis and Embrace Opportunity

As we enter into 2024, the world is experiencing conflicts in a multitude of countries and these conflicts are having an adverse effect on global trade, which in turn, impacts global financial markets. As EY, a consultancy, says in its report on how boards of American companies can confront crisis and embrace opportunity, "Dynamic global crises continue to challenge companies, with the escalation of conflict in the Middle East, the war in Ukraine, geopolitical complexities related to China, and an uneven global economy creating a sense of permanent crisis on a multitude of fronts." 

The multinational consultancy adds: "At the same time, exceptional growth opportunities seem at hand. Generative AI (GenAI) represents a groundbreaking leap in technology with the potential to increase productivity and transform work, business models and society. Further, the continuing energy transition demands a reframing of business strategy to mitigate risks and thrive in a low-carbon economic future."

Moreover, "In this context of crisis and opportunity, directors are deepening their engagement. They are guiding companies to build resilience by considering multiple alternative scenarios and carefully balancing discipline and transformation."

Below are the key findings of each chapter of the report with recommended actions for boards and questions a board should be asking (the recommended board actions and questions are copied verbatim):

CHAPTER 1: STAY AGILE AMID CONTINUED ECONOMIC UNCERTAINTY

The report's first chapter focuses on how to stay agile amid continued economic uncertainty. The chapter's key point is boards should enhance oversight and flexibility as uncertain economic conditions persist. "Global economic activity remains subdued heading into 2024, with rising geopolitical tensions and tightening financial conditions as key risks. As the year begins, companies can expect slower business and consumer spending, along with softer labor market conditions and still-elevated costs." Furthermore, "Companies must navigate an ever‑shifting landscape of geopolitical and economic uncertainty. To do so, they will need to build resilience and agility in their operations."

What boards should do in 2024:

• Embrace agility and oversee flexible strategic planning that incorporates dynamic multi-scenario planning. Boards have an opportunity to guide management, pressure-test plans, and assess multiple options for achieving strategic goals in the current operating environment. Directors should ask what economic, financial and customer demand scenarios have been considered and what the potential impacts are on financial performance, growth and strategy.
• Confirm how the board will receive timely updates about macroeconomic developments that could impact the company. The board is a strategic resource to the management team in preparing for different economic scenarios and thus needs timely and relevant information from experts beyond the management team to do this effectively. This information should directly inform scenario planning.
• Help management focus on the long term. This will be important as the company considers how to adapt to potential economic deceleration and various challenging geopolitical developments. For example, the board can oversee how productivity, training and efficiency gains can offset higher labor costs. The board can also encourage capital strategies that position the company to thrive as broader technology and sustainability trends continue to reshape the business environment.

Questions for the board to consider in order to enhance oversight and flexibility as uncertain economic conditions persist:

• How is the company planning for a range of economic scenarios, including those in which geopolitical developments keep inflation elevated, and potentially rising, for longer?
• How often does the board ask leadership: "What if we’re wrong?" How is the company considering what it would do differently if a low-probability, high-impact scenario was to emerge?
• What is the company doing to stress-test its balance sheet and develop and test a crisis playbook that gives company leaders comfort in their ability to manage through even the worst‑case scenario?
• How is the company developing a resilient strategy around pricing, capacity management and location, and distribution that is nimble enough to navigate a world where demand will ebb and flow more significantly than in the past few decades? How is scenario planning supporting that strategy?
• How is the company evaluating costs, investments and decisions in the context of its long-term strategy, especially regarding technology, talent and the energy transition?

CHAPTER 2: BALANCE DISCIPLINE AND TRANSFORMATION IN CAPITAL STRATEGY

Focusing on how to balance discipline and transformation in capital strategy, chapter two of the report discusses how to adapt strategic priorities to a slower-growth environment. According to EY, "A mantra for many leadership teams this year will be financial discipline. Growth at any cost has given way to investments that must show a clear path to profitability or value creation. Still, companies cannot afford to retrench." In addition, "Companies cannot afford to let financial caution prohibit necessary investments for long-term growth, such as those related to technology and sustainability."

What boards should do in 2024:

• Encourage accelerated investment for long-term growth and competitiveness. Boards must keep the long term in view for management so that companies do not miss out on innovations or avoid tough decisions that will be necessary to stay competitive in a future that will look very different from the past.
• Enable management to maximize profitability and position for business model transformation. Challenge how management is identifying opportunities for cost management, tracking the progress on investment decisions and considering how markets could evolve and impact the use of capital in existing and potential businesses. Probe how internal rationalization, cost cutting and divestitures can fund future transformation.
• Promote enhanced communication with investors about the company's capital strategy. Capital allocation can be a key area of focus for activist investors, and a bear market leaves companies more exposed at a time when investors are less forgiving. In an environment of heightened shareholder activism, boards can help challenge whether companies are doing enough to communicate the company's strategy narrative proactively with shareholders.

Questions for the board to consider to facilitate the balancing of discipline and transformation in capital strategy:

• How is the company optimizing its capital management and reducing direct and indirect costs through an era of continual change? How is it considering internal cost cutting as potential funding for ambitious transformation?
• How is the company investing to mitigate risk and create long‑term growth opportunity despite multiple headwinds? Is it maintaining the right balance of innovation and capital strength?
• How is the board defining its role as stewards of investor capital? Does that role include positioning the business to thrive as the world evolves?
• How is the company's capital investment strategy changing in areas such as digital and technology, people and skills, innovation and research and development (R&D), and sustainability? How are board committees coordinating their oversight of these matters?
• What types of transactions (e.g., M&A, divestment, new joint ventures or strategic alliances) is the company considering to achieve its strategic goals? Are those options explored at the board level or is the board presented only with management's decision?
• How is the company's investor engagement program keeping key shareholders informed of the company’s long-term value creation strategies and the board’s related expertise? Do disclosures describing the board’s composition demonstrate that, individually and collectively, the board is fit for purpose?

CHAPTER 3: EMBRACING CYBERSECURITY AND DATA PRIVACY AS STRATEGIC ADVANTAGES

The next chapter of the report addresses the importance of embracing cybersecurity and data privacy as strategic advantages. Emphasizing how companies should broaden cybersecurity and data privacy beyond compliance, the report points out that "While cybersecurity and data privacy are perennial concerns for boards, they include a complex set of always-evolving drivers, and background knowledge that can quickly stale. 2023 saw a variety of different changes in the cybersecurity landscape, such as the quick adoption of new technologies, new geopolitical influences, new regulatory requirements and increasing nation‑state bad actors." What is more, "A more complicated environment will likely cause many organizations to mature their cybersecurity oversight through 2024."

What boards should do in 2024:

• Reconsider whether cybersecurity oversight is structured the right way. The new SEC disclosure rules may be a good opportunity for the board to reconsider whether it is structured appropriately to oversee cybersecurity in the years ahead. To do so, it may consider adding (or removing) a focused committee, concentrating or distributing cyber expertise throughout the board, changing the cadence of cyber discussions, or otherwise altering the board agenda.
• Participate in complex cyber threat tabletop exercises. These can be done either separately or with management, and complex cyber exercises can be incorporated into the board calendar. These scenarios should be varied and dynamic. Although it may be unlikely that a specific scenario will be replayed in real life, the simulation can develop the board’s muscles for dealing with a challenging crisis; pressure-test existing playbooks, discussing policy such as whether the company will pay ransoms; and uncover opportunities to improve processes and procedures.
• Maintain a wide variety of voices in the boardroom. In addition to members of the cybersecurity team, directors may seek a variety of voices, ranging from operators and internal audit to HR and strategy, to understand the company's preparation that extends beyond threat and response to data privacy and ethical data usage. This can give insight into how the company’s cyber risk appetite is being applied and whether the cyber risk culture meets expectations. Further, complexity can be a barrier to effectively combating cyber threats. The board may ask management teams to consider how IT security systems can be simplified.

Questions for the board to consider to embrace cybersecurity and data privacy as strategic advantages:

• How has management adapted the cyber response playbook to the threat environment that continues to evolve?
• Have appropriate and meaningful cybersecurity and data privacy metrics been identified and provided to the board on a regular basis, and have dollar amounts been assigned to these risks?
• What is the state of the organization's cyber risk culture? How can the organization minimize employees' susceptibility to online manipulation and deceit?
• What information has management provided to help the board assess which critical business assets and partners, including third parties and suppliers, are most vulnerable to cyber attacks?
• How does management evaluate and categorize identified cyber and data privacy incidents and determine which ones to escalate to the board?
• How does the organization use data to build and maintain trust with stakeholders, such as employees, customers, suppliers and investors?
• What controls are in place for ethical usage of technology to promote stakeholder trust and data privacy?
• Has the board participated with management in one of its cyber breach simulations in the last year? How rigorous was the testing?
• Has the company leveraged a third-party assessment to validate that the company's cyber risk management program is meeting its objectives? If so, is the board having direct dialogue with the third-party related to the scope of work and findings?

CHAPTER 4: GUIDE RESPONSIBLE AND TRANSFORMATIVE INNOVATION AND TECHNOLOGY

The fourth chapter of EY's report addresses the importance of guiding responsible and transformative innovation and technology by enabling the company to innovate in a way that is both revolutionary and ethical. "GenAI is only one of many emerging technologies that is already impacting business in expected and unexpected ways. Other technologies and innovations include the metaverse, Internet of Things, Web3, and quantum computing. These advancements will transform the work organizations do and the environment in which they operate." The report further asserts that "GenAI's appeal puts pressure on management to take advantage of its potential for strategic advantage before their competitors do, or risk falling behind."

What boards should do in 2024:

• Strengthen management accountability for responsible AI. Boards are in a strong position to make sure that management teams are creating responsible AI policies that effectively manage the risks and capitalize on the opportunities available for the enterprise while keeping the company's values and purpose as a north star. It is not enough to require that policies are in place. Boards should go further to push management to ensure that employees adhere to such policies, that there is a mechanism to determine if they are not and that managers are quickly fixing problems.
• Embrace a range of perspectives and experiences in the boardroom. Directors with a wide variety of professional and lived experience are increasingly important to help drive innovation and govern emerging technology. This diversity enables the board to better identify nontraditional threats and encourage management teams to responsibly leverage new technologies and innovations. Further, a variety of perspectives from within the boardroom fosters an environment that facilities robust discussion, allowing key assumptions and conclusions in strategy, operations and other areas to undergo thorough pressure testing.
• Gain visibility into external trends and internal capabilities. An intentional approach to understanding the trends likely to impact the company over the long term is critical for a "future‑back" approach to strategy. This strategy approach envisions possible future scenarios and then works backward to identify the strategic objectives in order to ensure the company is viable in that future. Further, working to understand the company's internal capabilities by going beyond C-suite presentations through hands-on experience and R&D visits can help the board better evaluate how management is placing bets across the enterprise.
• Build agility into the decision-making process. The pace of innovation is fast and may only get faster. A traditional board meeting cadence — four to six full board and committee meetings a year — may be insufficient to support the needs of the company. Boards should work with their management teams to consider a more flexible trigger-based approach to strategic planning that entails a more consistent evaluation of the future. At the same time, boards may gain value by looking inward to consider the current structure for overseeing innovation and emerging technology. Confirming that the board’s structure remains fit for purpose is critical to making sure the board does its best to support innovation and emerging technology.
• Investigate innovation in the boardroom. The board may start to consider the ways in which innovations such as GenAI can improve its own work. GenAI may be able to support boards by summarizing large and complex board materials, more efficiently schedule time for board and committee meetings, and provide background and learning curriculum for new and emerging boardroom topics.

Questions for the board to consider to enable the company to innovate in a way that is both revolutionary and ethical:

• What is the company's path to value with GenAI and other technologies? How are the risks identified and managed?
• What policies has the company implemented to confirm that GenAI is used responsibly? How does management know they are working?
• How is the company's innovation budget and program contributing to the creation of an informed strategic plan leveraging emerging technology?
• How is the board thinking about and redefining competitors or industry boundaries? Who might now be a competitor but wasn't previously?
• How are responses to changing stakeholder demands, expectations and operational disruptions leading management teams to innovate?
• How are investments in innovation tracked and reported to the board? Is the board engaged in innovation discussions as part of the strategy-setting process?
• How is the board building a foundational understanding of evolving technologies, including learning through hand-on demonstration and experience? How will companies create an ecosystem in which AI and data protection coexist and create synergies to generate a better value proposition for users and customers?

CHAPTER 5: ENABLE A PEOPLE-CENTRIC WORKFORCE STRATEGY

Chapter five of centers on enabling a people-centric workforce strategy by guiding talent engagement and cultivation amid a rebalancing of power and a reimagining of work. "The talent landscape is constantly being disrupted by a combination of cyclical and structural forces. This has led to a divergence in perspectives between employers and employees." I agree that "Employers may be underestimating the fluidity of the labor market." As the report explains: "While 57% of employers believe that a more challenging economic climate would reduce employees' likelihood of seeking new jobs, the survey found that a significant 34% of employees expressed their willingness to leave their current jobs within the next 12 months. This highlights the importance of talent availability, acquisition and retention. For directors who view talent as a top priority in 2024, 77% said these topics were most important."

What boards should do in 2024:

• Seek a deeper view into employee sentiment and perspectives by hearing from employees more directly. Boards should actively engage with the chief human resources officer (CHRO) and seek direct input through tools such as pulse surveys and interactions with front-line employees. This approach enables boards to hear employees' voices directly and fosters a culture of inclusivity and engagement.
• Guide management to put people first in workforce strategy and cultivate a culture of trust. This involves boards evaluating the leadership team and their incentives to energize and inspire employees, ultimately gaining their trust. Additionally, boards should oversee how management implements workforce re‑skilling and training initiatives to prepare the workforce for future challenges, while actively involving employees as partners in that transformative journey.
• Enhance stakeholder communications around compensation committees' oversight of human capital matters. With potential new SEC rules and heightened attention on high-profile strikes, stakeholders will scrutinize the board’s role in governing the talent agenda. Investors will seek to understand whether the compensation committee or full board has a meaningful impact on shaping a resilient talent strategy.

Questions for the board to consider to guide talent engagement and cultivation amid a rebalancing of power and a reimagining of work:

• How does the company's talent strategy advance its overall strategy? What changes have been made to other elements of the business to advance the talent strategy?
• How is the company identifying and addressing employees' chief areas of concern?
• How is the company's leadership team earning trust with employees? Do the company's employees feel connected, inspired and well-informed at work? Do they feel that leadership cares about them as people?
• How often is the board engaging directly with the CHRO or equivalent and what is the substance of those discussions? How is the board getting a direct line of sight into employee perspectives below the executive level?
• What human capital management metrics are the board or compensation committee reviewing? How do those metrics align with the long-term talent strategy, and what narrative is the company communicating to stakeholders about its talent agenda?
• How is the company providing support for career path and progression, including mentoring, learning and development programs, and updating organizational design to open opportunities for advancement? Are upskilling and retention central to the company’s talent strategy, including key areas such as technology and sustainability?
• How is the company making the use of AI compatible with talent development so that the company’s strategy can adapt quickly to the constantly changing business ecosystem?
• How is the company approaching in-office, fully remote or hybrid working models and maximizing the human experience of work in its talent strategy? How is the board getting insight into employee sentiment related to hybrid and remote working across different job functions, geography, age and gender?

CHAPTER 6: KEEP OTHER FOCUS AREAS ON THE BOARD AGENDA 

With the thesis of balancing top priorities with additional imperatives, being careful to not overwhelm the board agenda, the report's sixth chapter addresses the importance of keeping other focus areas on the board agenda. "The board's priorities for 2024 are not the only areas of risk and opportunity that boards will need to address this year. There are other business imperatives to consider in the year ahead" such as keeping pace with regulatory developments, guiding political considerations, overseeing supply chains as strategic assets, and addressing climate change and environmental stewardship.

Questions for the board to consider 2024:

• What systems and processes are in place to monitor international and domestic legislative and regulatory developments and keep the board informed as appropriate? How is management taking prudent action now to prepare for future regulation as appropriate?
• How is the company ensuring visibility across global supply chains and considering alternative suppliers to improve resilience to shortages or price volatility? Is it evaluating supplier relationships for potential geopolitical complications and exploring alternative networks tuned to the new geostrategic environment?
• Does the company view climate- and nature-related initiatives as a means of protecting and creating more value for the business?
• How is it exploring opportunities to transform its business portfolios while reducing emissions?
• How is the company engaging and supporting suppliers to influence emissions reduction through their supply chains? Has the company considered a strategic partnership or joint venture to help achieve its climate agenda?
• How well do management and the board understand how geopolitical developments affect current and future strategy? Is scenario planning used to explore multiple plausible futures and their potential business implications systematically?

GOING FORWARD IN 2024: ENHANCING THE BOARD'S STRATEGIC VALUE

EY concludes its report noting that "In 2024, boards will need to enhance their strategic value by enabling resilience through discipline and transformation. They must guide management to balance short-term demands and long-term growth and support the organization as it confronts crisis and embraces opportunity."

Moreover, "While cyclical changes such as inflation and consumer spending require attention and may present tactical opportunities, it is structural changes such as the GenAI revolution, geopolitical fragmentation and the energy transition that are significantly impacting strategy and raising the stakes for businesses and society. Effective boards will provide valuable insights, effective challenge and leadership to enable companies to make agile decisions aligned with their values in this turbulent environment."

In the report's introduction, EY notes that its "2024 board priorities relate to near-term issues (e.g., economic uncertainty and the cost of capital) as well as longer-term priorities (e.g., innovation and workforce development)." I agree that "A crucial role of the board this year will be guiding management in balancing what is urgent to address now with what is vital to invest in for the future." How is your business balancing the urgent matters that need address now with investing in vital initiatives for a sustainable future?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

AI Led the Global Conversation at CES 2024

Me, my mom, Lindy Rose, and my
colleague, Patricia Berdejo, attending
CES on Jan. 12, 2024

"AI, AI, AI," was the prominent theme at CES® 2024, which saw over 4,300 exhibitors including a record 1,400+ startups from around the globe in Eureka Park®. As in previous years, this year's CES, which took place from Jan. 9-12, 2024, showcased the innovative trends shaping tomorrow and solving the world's most pressing challenges. This post focuses on a few of observations of attending this year's event in Las Vegas, Nev.

As noted in a press release issued by the Consumer Technology Association (CTA), the organization that produces CES, artificial intelligence "led the global conversation at CES 2024. Companies highlighted the enormous potential of AI to improve our world with cutting-edge applications that will transform how we communicate, do business and take care of one another." Several AI-focused panel sessions took place during the four day event including on that explored the relationship between ethics and AI in academia, AI's impact on the creative process and content businesses, and how generative AI is leading the transformation of hardware and chips.

CTA's announcement also notes that "CES established access to technology as the eighth pillar of the Human Security for All (HS4A) global campaign, which focuses on the critical role technology plays to improve every aspect of the human experience." Tech is a catalyst for tomorrow, powering solutions to pressing global challenges." Attendees saw the release of a new report released Force for Good on tech's influence on human securities. "Aligned with CTA's CES 2024 Tech Trends to Watch, the report proved that universal connectivity and leveraging AI across human securities will improve our world," the Arlington, Va.-based organization said.

More companies are showing their commitment to sustainable solutions "through technologies, products, and services to reduce emissions and waste by streamlining electrification, developing renewable energy sources, and experimenting with new technologies such as battery recycling." As for Accessibility & Innovation for All, the CTA points out that "CES 2024 fostered a platform centered on universal design for the diverse tech industry to come together and converse on the next wave of innovation. CES featured sessions on diversity in the tech industry, a wave of new technologies that will improve lives and advances in accessible gaming. CTA also announced a new investment partnership in TFX Capital, which supports veteran entrepreneurs in tech."

As for digital health, the CTA explains that "Tools and technologies aimed at lowering costs, improving health equity and saving lives were highlighted. Innovations included digital therapeutics, mental wellness, sleep tech, women's health tech and telemedicine. At the CES Digital Health Summit, Mark Cuban and his Cost Plus Drug Company broke news about a new partnership, while capacity crowds joined the Digital Health mixer and programming with officials from the FDA and across the health policy space."

In what continues to be one of my favorite components of CES, Eureka Park grew this year with over 1,400 exhibiting startups including country and territory pavilions representing France, Hong Kong, Italy, Israel, Japan, Korea, the Netherlands, Taiwan, and Ukraine. As highlighted in the previous post on this forum, I attended an event that preceded CES that featured several European startups. During CES, I had the opportunity to getting better acquainted with the founders at the exhibit booths in Eureka Park.

Among the other exhibitors from around the globe, I was impressed with Brickify, a Nigerian startup that is turning recycled plastic waste into water-, fire-, and heat-resistant paving bricks used to construct roads and low cost homes. Ghostpass is a company based in Korea that created a decentralized remote biometric authentication solution that monitors and controls large amounts of biometric information by storing it individually on users' smart devices rather than storing it in bulk in the cloud.

Midbar, which is another firm based in Korea, created an inflatable farm that enables food production anytime, anywhere. Without heavy and costly steel frames, the AirFarm is designed to be lightweight but sturdy. The AirFarm converts moisture from the air into water in real-time. It recirculates the moisture produced by crops back to the roots, making it the world's first farm that operates without water infrastructure.

Lastly, as mentioned by the CTA, while we are experiencing "a moment of global uncertainty and rapid technology advancement, government leaders shared an optimistic view of regulation to empower tech innovation, including in AI." At the Innovation Policy Summit, over "160 international, federal, state and local government officials and staff participated in the Leaders in Technology Program, which convened top innovators and policymakers to discuss the future of pressing tech policy issues, including privacy, health innovation, trade policy, competition, artificial intelligence and self-driving vehicles."

If you attended CES 2024, what were your key moments and takeaways?​

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

Cautious Optimism About Europe's Tech Sector

European tech startups are thriving, according to an article published by The Economist. The article points out that "Europe now creates more startups than America: around 14,000 between January and September [in 2023], compared with 13,000 across the Atlantic." Furthermore, "The old continent, including Britain, has more than 41,000 young tech firms and about 3,900 more mature ones. Together they employ 2.3m or so people, about twice as many as in early 2019 and more than in Europe's property sector (excluding construction). The total value of Europe's private and publicly listed tech companies is again nearing the peak of $3trn reached in 2021." It was $2.8trn in 2022.

The article adds that "European tech's relative resilience can be explained by its increasing maturity. Take the number of companies founded by ex-employees of successful startups. More than 9,000 people who worked for those of today's unicorns which were created in the 2000s have gone on to found their own businesses. That is about 50% more than the number of people who left unicorns which date back to the 1990s in order to strike out on their own."

What is more, as Europe's tech industry continues to mature, it "is also developing its own characteristics. European founders are less cock-a-hoop than their American counterparts at all things ChatGPT-like: from January to September [2023] Europe saw 35 financing rounds backing developers of generative artificial intelligence, compared with 106 across the pond. By contrast, climate-related startups accounted for 27% of all capital invested in European tech in 2023, a much bigger share than in America. Climate-tech firms have now overtaken fintech, until recently Europe's most represented technology niche."

But when comparing Europe's tech sector to America's, the article asserts that the former "is unlikely to become as big as America's just yet. Silicon Valley and its satellites in Austin, New York and elsewhere are still way ahead. America's herd of unicorns (about 700 on last count) is twice the size of Europe's (356)." As someone who has closely observed Europe's startup scene, I concur with the following:

The biggest obstacle to European startups' ambitions is home-grown, however. The EU has repeatedly tried to create a single digital market as frictionless as the American one, but differences in taxes and regulations still abound. Europe has shown what is possible, says Zeynep Yavuz, who invests on the continent for General Catalyst, an American VC firm. The explosion of enterprise in fintech in recent years was a direct result of bloc-wide regulations drafted in Brussels. If EU leaders really want to strengthen European tech, which they all profess to do, they should spend less time trying to regulate various digital markets and instead create a single truly European one. 

Me and my advisor, Lindy Rose
(who also carries the important title
of being my mom), attending
the Silicon Valley Funding Summit 

Setting aside my concerns about differences in taxes and regulations, I continue to seek investment and partnership opportunities with European startups. As I have in previous years, I had the opportunity to attend the Silicon Valley Investment Summit on Jan. 8th, 2024 in Las Vegas, Nev. This event, which aims to connect investors to global startups who are seeking funding and strategic partnerships, precedes CES®. I was provided the privilege of serving on a panel of esteemed investor judges who provided valuable feedback to over 40 startup entrepreneurs. While most startups are headquartered in Europe, some are domiciled in North America (and a couple from South Korea) as this event received support from organizations based in the U.S.):

• Captio (Austria) makes complicated texts simple through their software that translates information into easy-to-understand language, offer trainings and develop digital solutions around the topic of comprehensibility.
• ColibrITD (France) has an objective to utilize the power of quantum computing and technology in the noisy intermediate-scale quantum (NISQ) era, which is the current state of the quantum industry. The Quantum Innovative Computing Kit or QUICK provides customers with technological, financial and environmental excellence in a software platform that runs use cases in the best available hardware at the lowest cost and with optimal energy efficiency.
• .lumen (Romania) aims to help visually impaired people live a better life. Their glasses for the blind reproduce the main characteristics of a guide dog, all in a scalable product. And the product allow users to have a better mobility, helping them to have easier access to education and then jobs, thus helping to improve their social life.
• PhotonFi (USA) is transforming the landscape of wireless communication standards through the utilization of LiFi technology. Their innovative approach involves harnessing the potential of invisible light to transmit and receive information at remarkable speeds, delivering enhanced security and mobility.
  
• SiPeral (France) is developing a high-performance, low-power microprocessor that will be the heart of European supercomputers essential to Europe's technological sovereignty in strategic areas such as artificial intelligence, medical research, climate change mitigation, energy management.
• SMT (South Korea) has a product that measures the water quality and temperature in real time, filters water, and sterilizes it with UV rays at the same time.
• Veintree (France) is providing everyone an easy access to a secure digital tool to protect their private life through biometric solution based on the capture and analysis of hand vein networks to authenticate users, without identifying them.
• Xelera Technologies (Germany) is a software provider for high-speed network technology and machine learning applications. They solve data rate and response time bottlenecks in software applications and systems with a performance-optimized software stack. Their product also increases the energy efficiency of data center and cloud servers.

I wish to thank the European Network of Research and Innovation Centers and Hubs, USA (ENRICH in the USA) for producing such a great event in partnership the University of Nevada Las Vegas Office of Economic Development, UNLV Sports Innovation, European American Enterprise Council, European Innovation Council and SMEs Executive Agency, Enterprise Europe Network, Angel Launch, Keiretsu Forum Southern California, myGlobalVillage, NGI Enrichers, Small Business Development Center (SBDC) at the University of Pittsburgh, Silicon Valley SBDC, Temple University SBDC, and the Foundry 415 Innovation Group. It is always a great experience attending ENRICH in the USA's events and I look forward to attending the next Silicon Valley Funding Summit.

​Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.